Maryland expands financial relief
Tax credit covering more immigrants with low incomes
Tens of thousands of low-wage workers — including many immigrants — now qualify for a significant tax break, after Maryland lawmakers voted to expand a coronavirus financial relief program and the governor did not block the measure from becoming law Friday.
The law allows workers who pay taxes but lack a Social Security number to claim an earned income tax credit, which is designed to help low- and moderate-income workers keep more of their earnings.
The expansion applies to workers who pay taxes through an Individual Tax Identification Number, or ITIN — a group that includes immigrants, including some with lawful status and some without.
In 2019, 86,000 Maryland workers paid taxes this way and 60,000 of them had incomes low enough that they would have qualified for the tax credit if allowed. That number could be greater now, given that incomes have shrunk due to a recession caused by restrictions to control the spread of the coronavirus.
Lawmakers pushing for the expansion of the earned income tax credit framed it as a moral imperative to help working Marylanders who had been shut out of recent pandemic aid, despite paying taxes.
“These families are making every effort to be a good neighbor. They are making every effort to be a good citizen. They also carry their share of responsibilities in society. They pay taxes. They file,” said Del. Joseline Peña-Melnyk, a Democrat representing Prince George’s and Anne Arundel counties.
The House of Delegates voted to approve the bill with a 91-44 vote, largely along party lines, with Democrats in favor. It followed a 32-15 vote in the state Senate last week. Both votes were sufficient to overturn a veto from Gov. Larry Hogan.
The Republican governor previously opposed putting a similar provision in his RELIEF Act, a pandemic financial aid bill that’s now law.
When Democrats pushed to add ITIN taxpayers to that legislation, he said that put the entire bill at risk.
General Assembly leaders presented the separate bill Friday afternoon to Hogan. He chose to allow it to become law without his signature, according to his spokesperson, Mike Ricci. The governor offered no explanation or comment on his decision.
The earned income tax credit, or EITC, helps lessen the tax burden for workers with low incomes, particularly those with children who are their dependents.
Typically, workers who use the EITC end up with hundreds of extra dollars in tax refunds. Advocates say this can help people catch up on bills, pay security deposits and move out of poverty.
The eligibility ranges based on the taxpayer’s earnings and family situation, from a maximum of about $16,000 for a single adult to a maximum of about $57,000 for a married couple with three or more children that’s filing jointly.
Allowing ITIN taxpayers to use the credit adds up to more than $64 million in annual costs to the state, according to a nonpartisan legislative analysis.
Republican lawmakers raised concerns about giving a tax break to a group of people that includes some who came to the United States without legal permission. They proposed multiple amendments to rein in the benefit so that it only would go to legal immigrants; all were defeated.
Del. Sid Saab, an Anne Arundel County Republican who came to the U.S. from Lebanon at age 19, called it “a slap in the face to every single immigrant that comes here legally” to give benefits to those who did not come legally.
Comptroller Peter Franchot, a Democrat who has announced a 2022 run for governor, praised lawmakers for their “fair treatment of our neighbors.” As the state’s chief tax collector, Franchot’s office is responsible for administering the state version of the EITC.
The immigrant advocacy group CASA celebrated the bill’s passage, saying it provides desperately needed help for low-wage workers.
“This is a victory for Maryland’s immigrant families, who have been serving, cleaning, and working for others selflessly throughout the pandemic,” said Cathryn Ann Paul, a policy analyst for CASA, in a statement.
Del. Jheanelle Wilkins, who said she migrated with her family from Jamaica at age 5, said the pandemic makes it more important than ever to help those who are struggling.
The coronavirus pandemic, the Montgomery County Democrat said, “does not recognize immigration status. There are so many Marylanders in our communities, our neighbors, our friends, our families, who are disproportionately impacted by this pandemic.”
Del. Gabriel Acevero said it’s only fair for all taxpayers to have the opportunity to benefit from aid programs. “When you pay into the pot, you should be able to get something from it,” said Acevero, a Montgomery County Democrat.